Bildt plays down nanny tax 'scandal'

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Sweden's foreign minister Carl Bildt has dismissed allegations that he has been flouting the country's tax rules by not paying any taxes for his nanny in Sweden.

The denial comes following an article in the Aftonbladet newspaper which revealed that Bildt's nanny, despite being registered as a resident in Sweden, has her income taxes and social fees paid in Italy.

The nanny, a 46-year-old woman from Ukraine, was originally employed in Italy by Bildt and his Italian wife, Anna Maria Corazza Bildt, and splits her time between Italy and Sweden.

“It's absolutely correct that she isn't bound by any tax in Sweden. That is a decision which was taken by the tax authorities based on the information they received,” Bildt commented on his blog.

Bildt's wife told Aftonbladet that the nanny is registered in Sweden so that she can have as many rights as possible.

In addition, said Corazza Bildt, the family's tax matters, including paperwork related to the nanny's Swedish work permit, had been handled by the Öhrling Pricewaterhouse Coopers accounting firm.

But according to Pia Blank Thörnroos, an expert from the Swedish Tax Agency (Skatteverket), the general rule is that if someone is registered as a resident of Sweden, that person should pay tax in Sweden.

The Bildt family counters that their nanny is in Sweden fewer than six months out of the year.

If that is the case, said Blank Thörnroos, then the nanny ought not to be registered in Sweden in the first place.

Moreover, even work carried out in Sweden by people registered as residents of other countries are subject to a special 25 percent income tax, a rule to which the Bildt family has failed to abide.

Corazza Bildt tells the newspaper that she trusts the accounting firm has “taken care of the entire process”.

“These are very complicated issues, I want to be sure that they are handled in the right way,” she said.

“But this is a surprise to me. I'll have to look into it.”

On his blog, the foreign minister accused Aftonbladet of trying to create a scandal where none exists.

“The whole arrangement has been formulated by one of the country's most respected accounting firms,” he writes.

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